LGST 369 Assignment 3 - Sent in 100% - Assignment 3 Part A...

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Assignment 3Part A:Contracts are made daily to make a lawfully binding agreement between two or more parties. The terms in the contracts can be written or verbally agreed upon. Each of the parties involved should ensure that the terms and words in the written contract are agreed upon. This is an on-going issue within the court system because parties often disagree on the interpretation of those words. There are several principles and rules that can be applied to interpret contracts such as the literal approach, contextual approach, golden rule, and contra proferentem rule. The literal approach to interpretation of contracts and other business documents can be defined as simply assigning words their ordinary meaning. The courts often use this approach to resolve disputes and ask how a reasonable business person in the parties’ positions would have interpreted the relevant clause (McInnes, 2014). However, since each party has a difference of opinion on how to interpret the words, it is often very difficult to come to a conclusion. The literal approach can also be considered as an advantage or disadvantage. The advantage of using the literal approach is that it ensures the court system can simply apply the law and not have to consider each party’s presumed intentions and circumstances. The approach promotes consistency within the court system, as well as predictability of the outcome. If the literal approach were always used, each case would be decided using the same principle. However, the literal approach is not without disadvantages.The court system has recognized that the author of the contract can use particular words to avoid unfavorable outcomes and/or liability. Unfortunately, as I will demonstrate, the interpreter can as well.

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